Point of law: whether registration of popular domain names in RU zone, selected on the basis of submitted applications, by the accredited registrar for himself, and the subsequent sale thereof in a closed auction may be regarded as a fair competition on the part of the registrar?
Alternative attitudes: 1) it may, because the actions of the registrar purported to prevent abuses, i.e. cybersqatting and further profiteering; 2) it may not, because such actions do not prevent the abuses in question, but instead merely guarantee the extraction of profits by the registrar himself, who, by using his powers and the assistance of other registrars, has appropriated those domain names, for which more than one application had been submitted, in order to resale them in an auction at a higher price; therefore, the condition regarding auctions is unfair.
Ratio decidendi: the second attitude is correct. The actions of the registrar violate the customs of business turnover. The purposes of his activities (i.e. providing a public service of distributing domain names) must not be substituted with his own economic activities consisting in acquiring domain names and trading them, since only in this way the use by the registrar of his advantageous position and a conflict of interest with consumers (that is, his customers wishing to register his domain names) may be avoided; it follows herefrom that primary registration of domain names for the registrar himself, excepting cases of registration of a name for registrar’s own needs, is not in line with customs of business turnover, as well as the requirements of good faith, reasonableness and justice. When resolving the question as to whether a particular act is an act of unfair competition, it is necessary to take into account not only the aforementioned requirements of the law, but also the provisions of Art 10bis of Paris Convention for the Protection of Industrial Property, by virtue of which any act of competition contrary to honest practices in industrial or commercial matters constitutes an act of unfair competition.
Practical consequences: the Judgment does not provide for the possibility to reverse the judicial decisions that are already in force on the grounds of interpretations given by the Judgment. Therefore, such interpretations may guide only future disputes (those arising after the date of its publication).